The following was first published on The TIBCO Blog.
As shown in Healthcare Reform That Can’t Be Stopped, the Toyota Production System has found a home in healthcare. The Wisconsin-based TPS pioneer, ThedaCare, has been employing Toyota’s industrial efficiency principles in its hospitals to great effect for more than 10 years. Thedacare is now seeing great interest from other organizations, as the healthcare industry moves to reap the rewards of its move to digitize information. So much interest, in fact, that it has created the ThedaCare Center for Healthcare Value to help other organizations realize the promise of continuous performance improvement. Its head, former ThedaCare CEO Dr. John Toussaint, doesn’t mince words when he talks about what’s bringing all those organizations to his door — and it’s not federal legislation.
“Healthcare performance was and still is unreliable,” he says flatly. “Those who are honest about what they’re doing recognize that. Twelve years ago, ThedaCare compared manufacturing and healthcare quality and found healthcare to be far worse: 90,000 to 100,000 defects per million opportunities [versus the three defects per million norm in manufacturing]. That’s quite frankly still how U.S. healthcare performs. A 2010 HHS Study said we were killing 15,000 Medicare patients per month with medical errors. The NIH’s Crossing the Quality Chasm in 1999 showed the same thing. When you peel back the onion, we’re doing really lousy; maybe it has even gotten worse. Those of us who have been in the business of quality improvement have been trying to understand why that is and implement processes to change that.”
As proof of the effectiveness of its data-driven reform efforts, Dr. Toussaint points out that ThedaCare’s Collaborative Care has reduced medication reconciliation errors — that is, errors from incorrect or conflicting orders for medications — to zero and maintained that number for four years. Toussaint also points out that their published thirty-day readmission rate of under 9% is less than half the national average.
Whether reform is repealed or not, Toussaint says, “The reform initiatives in the private sector have already begun and there’s no going back because there just isn’t any money left. Healthcare delivery organizations are going to learn to live with less revenue. We have big problems that won’t be solved by throwing more money at them. We can either cut the healthcare workforce by x percent while reducing quality or we can use data and a proven methodology to make it less expensive and maintain quality. This transcends whatever happens in Washington.”
Does the Toyota method work in smaller, specialty healthcare? Seattle Children’s has been focused on the need to reduce variation in care. Dr. Howard Jeffries is the Medical Director of Continuous Performance Improvement and a practicing cardiac intensivist. He believes that regardless of the outcome in Washington, hospitals will be required to assume risk in the form of bundled payments models where both government and commercial insurers will pay a fixed amount for a specific treatment cycle. “The only way to survive is to predict cost. We can’t negotiate these rates until we know what our costs are, so our goal is to reduce variation as much as we can.”
Jeffries states that Seattle Children’s wants the only variation in process to be around the patient’s response to treatment. “What’s unique about us is that other care providers are trying to standardize as much as they can around the patient visit in peripheral ways, but we’re standardizing what we’re doing when we’re making clinical decisions for seeing a patient. We’re also looking at standardizing all other aspects of care from how you move through the system to what types of medication you’ll receive, including discharge and follow-up visits.”
Jeffries’ data-focused approach has the goal of standardizing care for 50% of Seattle Children’s patients within five years, up from the current 18%, but far higher than the 8% they discovered when they started one year ago, a number very common in the industry. They’ll need to tackle increasingly challenging care paths as the laws of diminishing returns kick in.
Asked how they create standards and reduce variation, Dr. Jeffries says, “We talk about it a lot, about the goals and why doctors practice. Are you a doctor to do what you want or to provide good care to your patients? The only way you can know is to measure and to have a standardized practice. If you don’t have a standard practice, anything you do differently is just noise.”
Dr. Jeffries also expects the rise of the Accountable Care Organization (ACO) where healthcare will be paid a fixed amount to manage a population of patients, including their outpatient needs. “This will require efficient networks of providers working with tight collaboration toward a common goal.”